View all newsletters
Sign up for our free email newsletters

Fighting for quality news media in the digital age.

  1. News
April 7, 2009

FT: Pension liabilities could scupper media deals

By James Michael

The depth of pension liabilities at some of the UK’s largest media companies could derail merger and acquisition activities, the Financial Times warned today.

Michael Rudberg, a partner at Ernst & Young said: “Pension plan deficits have ballooned in recent months, particularly for companies with large legacy plans in the media sector.

“Not only does this increase demands on future cash flows, but it is also one of the most critical factors in executing a sale transaction in what is an already challenging deal environment.”

Daily Mail & General Trust, Trinity Mirror and ITV were among those singled out as of particular concern by some financial analysts.

The report says that older media companies tend to be harder hit by pension issues as they are more labour intensive, tend to have quite large pension funds and generally have unionised work forces, which can make it trickier to cut back on staff benefits.

The gloomy forecast will undoubtedly fuel the growing belief in the media industry that the so called “big four” regional newspaper groups (Trinity Mirror, Johnston Press, Newsquest and Northcliffe Media) should become a big two – the FT says.

Content from our partners
MHP Group's 30 To Watch awards for young journalists open for entries
How PA Media is helping newspapers make the digital transition
Publishing on the open web is broken, how generative AI could help fix it

Email pged@pressgazette.co.uk to point out mistakes, provide story tips or send in a letter for publication on our "Letters Page" blog

Select and enter your email address Weekly insight into the big strategic issues affecting the future of the news industry. Essential reading for media leaders every Thursday. Your morning brew of news about the world of news from Press Gazette and elsewhere in the media. Sent at around 10am UK time. Our weekly does of strategic insight about the future of news media aimed at US readers. A fortnightly update from the front-line of news and advertising. Aimed at marketers and those involved in the advertising industry.
  • Business owner/co-owner
  • CEO
  • COO
  • CFO
  • CTO
  • Chairperson
  • Non-Exec Director
  • Other C-Suite
  • Managing Director
  • President/Partner
  • Senior Executive/SVP or Corporate VP or equivalent
  • Director or equivalent
  • Group or Senior Manager
  • Head of Department/Function
  • Manager
  • Non-manager
  • Retired
  • Other
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
Thank you

Thanks for subscribing.

Websites in our network